Plaintiffs file Opposition to UFC’s Motion for Summary Judgment in Antitrust lawsuit

September 21, 2018

Plaintiffs in the Zuffa Antitrust Lawsuit have filed their Opposition to UFC’s Motion for Summary Judgment.  The 47-page long opposition brief includes over 100 exhibits, many of which are redacted, or include deposition transcripts with redactions.

The main argument in the Plaintiffs’ Opposition is that the UFC is the “major league” of MMA and it has done so through predatory means.  The theory asserted is that it has become the top of the food chain in MMA through its retention of top-level fighters.  It argues that “a critical mass” of elite fighters is necessary to compete with the UFC.  But, the UFC’s scheme has foreclosed this opportunity.

Despite the fact Zuffa argued in its motion that there was ample competition within the industry as evidenced through testimony of rival MMA promoters and fighters that left the organization, Plaintiffs argue that the “supposed evidence of Fighter mobility merely reflects that the UFC is the “major league” of MMA and cuts Fighters who do not meet its standard.”

Plaintiffs argue in their brief that Zuffa’s anticompetive scheme was “designed to lock in current and potential top fighters to exclusive contracts for the most valuable parts of their careers.”

Oppos to MSJ – Plaintiffs by on Scribd

It noted that Zuffa used its market leverage to extend exclusivity over its fighters. This was done through coercion, intimidation and other means of forcible persuasion.  This included four ways outlined by Plaintiffs and evidenced through deposition transcripts.  This included:

  • Move Fighters to unfavorable placement on the fight card for an event
  • Control the timing of a bout (refuse to off Fighters bouts)
  • Delay a Fighter from competing for another promoter through the Right to Match and Exclusive Negotiation clauses in its contract.
  • Deprive fighters of title opportunities

Plaintiffs argue that Zuffa’s scheme impaired competition through locking up the majority of top fighters, deprived rival promoters of the key input of top fighters and relegated other promoters to feeder or minor leagues.  It calls out other promoters cited in Zuffa’s motion that indicated that they could compete “are not credible and are disputed.”  In fact, Plaintiffs show why Bellator, OneFC and PFL’s statements indicating that they are on par with the UFC are false.  Also, noted in a footnote to the motion, Absolute Championship Berkut, also recognized as a direct competitor, noted the cancellation of three events due to “organizational and financial problems.”

The Plaintiffs cite Dr. Singer’s expert report regarding the input and output markets and its showing how Zuffa has suppressed fighters’ wages, restricted the output of fighter services and excluded rivals.  Plaintiffs also argue that the acquisitions of other organizations by the UFC stifled competition and restricted fighter mobility.

Payout Perspective:

There is a lot to digest here and MMA Payout will take a deeper dive into the opposition including the evidence used by Plaintiffs.  The crux of their opposition is that the UFC’s anticompetitive scheme is based upon the retention of top tier fighters through exclusive contracts.  It locked in top fighters during their “most valuable parts of their careers” and was to leverage its market power to extend exclusivity.  As a result, it impaired competition despite the views of rival promoters that indicated it had no problem signing fighters it wanted.  As a result of the scheme, the anticompetitive effects included suppression of fighters’ compensation, reduction of “quality” MMA events and it suppressed marketwide output of MMA Events and inflated prices.  Furthermore, Zuffa cannot show that the contractual exclusivity provided procompetitive benefits which may outweigh the anticompetitive effects.

Zuffa has a chance to offer a Reply to this Opposition which will be submitted on November 2nd.

CSAC handed Jon Jones 3 months of community service

September 21, 2018

The UFC 229 press conference took all the headlines on Thursday but what went under the radar was the California State Athletic Commission giving Jon Jones 3 months community service as a result of his drug test failure last July.  USADA doled out a 15-month suspension to Jones on Wednesday after his second arbitration under the UFC Anti-Doping Policy.

According to MMA Junkie, the California State Athletic Commission called the punishment “agreeable, in concept.” CSAC Executive Director Andy Foster expected an 18-month suspension from USADA and the 3 months of community service was issued to “close the gap.”

An arbitrator in Jones’ USADA case determined that the former UFC light heavyweight did not try to cheat despite having traces of a banned substance in his system.

In February, Jones was fined $205,000 and had his fight license revoked.

No word on when and what type of community service Jones will have to perform.  But its assumed that he could re-apply for a license to fight in California once complete.

Payout Perspective:

The punishment by California should not be too surprising.  Jones has been out of action since July 2017 and the impetus was put on USADA to hand out its punishment.  The surprise was the arbitrator’s 30 month reduction of the guideline suspension per the UFC anti-doping policy.  Couple that with Jones’ remorse…once again, and California probably was not going to tack on anything substantial which would impede Jones’ career any further.

Joe Silva explains UFC matchmaking in deposition excerpts

September 20, 2018

After a little bit away, MMA Payout takes a look at some of the depositions taken place in light of the Zuffa Antitrust lawsuit.  The depositions were attached to the motion papers in support of Zuffa’s Motion for Summary Judgment.

Joe Silva, former matchmaker for the UFC, was deposed regarding his role with the company.  The deposition took place in June 2017.

Exhibit 52 – Depo of Joe Silva by on Scribd

Silva was asked about the acquisition of Pride and whether after the acquisition did Zuffa have the vast majority of the world’s top fighters.  Silva stated, “I would say we had the most, but not all.”  He added, “As you see that even after the acquisition, we continued to bring in other fighters from other places in the world.  If we’d already acquired all the best fighters, then no more acquisitions would be necessary.”

Silva was asked about when a fighter may be ready for the UFC and the talented 155 division.

There is a back and forth regarding an email from Stipe Miocic’s ex-manager Greg Kalikas.  The email indicates Silva telling Kalikas: “Too many 170s under contract right now.  Keep Stipe winning and we’ll get him in.”

 

Silva explained, “…it was very important for us to not have too many people on the roster.  We wanted to be able to manage it.  We wanted to be able to fulfill all our contractual obligations, so you have to limit the amount of people that you sign at any one time.  So at this time, 170 was particularly full….To maintain a fight for a fighter who didn’t get injured, I will now go to other people on the roster, and go, hey, I’ve got a dropout, fight’s only two weeks away from now, can you do it.  And if they go, no, I can’t make weight in two weeks, I haven’t been training, I’ve got an injury, I go to everybody who is on the roster.  If nobody can do it, I still want to get a fight that other guys, so now that’s an opening…”

Silva testified about a “policy” he had in which he would not release a fighter if they had lost 2 in a row and then lost a third but the last match was taken on late notice.  He also stated that he “never put pressure on anybody to fight late notice…”

He also stated that he left contracts up to the legal department although he knew that they were revised through the years.

He was aware of the fact that there is a provision in Zuffa contracts that extend the terms of the contract if fighters turn down fights.

There is some criticism about former UFC fighter Melvin Guillard.  It was based on an email to Dana White which states, “In the press conference the day before he said he is an A level fighter fighting in a B level show.  Never was the smartest guy.”  Originally, plaintiffs’ attorney thought he was talking about Justin Gaethje.  But, it appears that there is some mistaken interpretation as Silva explains that Guillard was talking about World Series of Fighting.


There is a text where he makes fun of Bellator’s main event of Tito Ortiz versus Rampage Jackson.  He explains about a comment regarding Jackson criticizing Silva for putting him up against fighters with wrestling backgrounds.

He also points to the hypocrisy of Bellator which was tournament based but turned to Ortiz- Jackson to headline their show.

There is also an email show to Silva in which Monte Cox emails Silva about the potential to have one of his fighters on a UFC Winnipeg show.  Silva responds that he could not because “I have to cut a hundred guys.”  Obviously, Silva was exaggerating but he explained about the roster and at the time – March 2013 – he had “too many fighters under contract.”

Payout Perspective:

The deposition testimony reveals a little bit behind the thought making process of Silva as he made the bulk of the matches for the company until he left shortly after the sale of the UFC.  He came off as a reasonable individual and there was not much in testimony that presented red flags.  Plaintiffs’ counsel did discuss some controversial emails which Silva easily explained away.

State appeals court overturns $8.5 million judgment against Canelo

September 14, 2018

A state appeal court in Miami has overturned a trial court ruling which found in favor of Canelo Alvarez’s former manager and ordered the boxer pay $8.5 million.  The Florida District Court of Appeals for Miami-Dade County set aside the judgment.

The appellate court decision filed two days prior to Alvarez’s big showdown against Gennady Golovkin in Vegas stated that the jury verdict awarding promoter Felix “Tutico” Zabala Jr of All Star Boxing $8.5 million was unjust enrichment, speculative and not supported by substantial competent evidence.  While the judgment was vacated, it did state that Alvarez have to compensate Zabala and ruled that the trial court determine the judgment.

Zabala brought the lawsuit against Alvarez and Golden Boy Promotions stating that Canelo signed a 4 year promotional deal and that Golden Boy took the fighter from the promotion.  Golden Boy was dismissed from the lawsuit prior to the trial which took place in June 2016.  A jury awarded the $8.5 million judgment plus 4.75% annual interest.  Alvarez filed an appeal.

H/t: Dan Rafael

Payout Perspective:

Interesting timing of the decision considering Canelo fights on Saturday.  Dependent on the trial court rendering a decision on the judgment, All Star Boxing may appeal the latest decision as the court has taken the decision out of the hands of the jury and installed its own ruling.  There are times when a court believes that he the judgment does not match the evidence, but that would seemingly undercut the rationale behind having a jury as a trier of fact.

Chiesa sues McGregor, Barclay’s over UFC 223 bus attack

September 10, 2018

TMZ reports that Michael Chiesa has filed a lawsuit against Conor McGregor for injuries he sustained in April when McGregor hurled a dolly at the bus that the lightweight was on.  Chiesa was injured as a result and was pulled from his fight against Anthony Pettis at UFC 223.

The lawsuit, filed in state court in New York, states Chiesa is suing McGregor for assault, battery and intentional infliction of emotional distress.  He is also suing Barclay’s Center for negligence as the incident occurred at the venue.  Chiesa’s theory likely claims lack of security allowed Conor to run roughshod in the bowels of Barclay’s.

McGregor was arrested on criminal charges but those charges were subsequently reduced to almost nothing.

Payout Perspective:

This is the second personal injury lawsuit that Conor is facing.  He still has the Nevada “thrown can” lawsuit.  If you have extra time, I talk about it here the Thinking Like a Lawyer podcast.   Unlike that lawsuit, Chiesa was smart enough to sue Barclay’s Center.  If nothing else, there is insurance coverage that may have some money for Chiesa.  With that being said, he does have a valid legal argument against McGregor.  It’s clear that Conor was acting reckless and the video should tell you that.  Plus, Chiesa legitimately lost money due to McGregor’s action.  Regardless of the severity of the injury, the monetary loss is real.  MMA Payout will keep you posted.

Nick Diaz cleared of criminal charges of domestic violence

September 2, 2018

The Las Vegas District Attorney declined to pursue domestic assault charges against Nick Diaz.  The charges result from a May 2018 altercation with a woman claiming to be his girlfriend.

The state did not move forward and the case was dismissed with prejudice by Las Vegas Justice Court judge Amy Chelini.  There were conflicts with the girlfriend’s story when interviewed by authorities which caused doubt in the allegations.  Police had ruled Diaz as the aggressor in the altercation which alleged resulted in an injured hip to the girlfriend.

But a grand jury declined to indict Diaz and after Diaz’s attorney, Ross Goodman, spoke with the district attorney’s office, the prosecutors decided to dismiss the charges.   Judge Chelini stated on the record that “they say you can indict a ham sandwich so that tells me everything I need to know.”  She also credited prosecutors for not dedicating any more resources to the case.  (transcript via MMA Junkie)

Payout Perspective:

The good news for Diaz is that he is cleared of all charges and may continue with his MMA career.  It does appear that the allegations were not solid to prosecute Diaz and based on the Court’s tenor, they did not believe that there was a case.

Plaintiffs in UFC Antitrust Lawsuit request Court to file response to MMA Manager Declaration

August 30, 2018

The plaintiffs in the UFC antitrust lawsuit have requested that the Court review its Surreply Brief in opposition to Zuffa’s Motion to Seal Zuffa’s Summary Judgment Motion and Portions of Plaintiffs’ Class Certification Reply.

Specifically, the Surreply Brief addresses the Declaration of MMA Manager Ali Abdelaziz which was included in Zuffa’s Reply Brief.

A Surreply Brief is not automatically considered by the Court, in fact, it is usually disliked since its additionally work for an already overworked court.  These types of briefs must bring up new evidence, facts important to the case not brought up or another exigent reason.  Reiterating arguments that would have been contained in an opposition will likely get poor treatment.

Here, plaintiffs believe the need to address Abdelaziz’s Declaration which Zuffa used to aid its Reply Brief.  The argument in which Zuffa uses Abdelaziz’s testimony is based on the need to seal payout information of fighters.

The manager of many top fighters submitted this declaration on behalf of Zuffa.  He claims that public disclosure raises “legitimate safety concerns” for fighters and their families.  He also believes that public disclosure of terms and compensation of fighters’ agreements.

Declaration of Ali Abdelaziz by JASONCRUZ206 on Scribd

It is worthy to note that no current UFC fighter signed a Declaration in support.  But, Abdelaziz, who represents a huge swath of UFC fighters supports the sealing of documents.  Although Abdelaziz’s declaration supports the last argument in Zuffa’s brief (and usually the weakest), plaintiffs felt compelled to address it.  The declaration was torn apart by the plaintiffs in its Surreply Brief.

Motion to FIle Surreply by on Scribd

Plaintiffs’ list four reasons why Ali’s Declaration fails: 1) The rationale that disclosure of fighter compensation hinders rather than helps in obtaining negotiating athlete purses rings false lin light of evidence of salaries of players in other major leagues.  2) The Declaration contradicts Zuffa’s own arguments in favor of sealing since it argued that disclosure would put Zuffa in a strategic disadvantage whereas Abdelaziz says non-disclosure is advantageous. 3) The allegation that fighters would be put at risk of kidnapping or extortion is not supported by credible evidence.; and 4) Plaintiffs calls Abdelaziz credibility a question since he’s an MMA manager and alleged principal in the WSOF as a promoter.

Payout Perspective:

While the brief is damaging, its still up to the Court to decide whether or not to take it into consideration.  Of course, we know that Zuffa will file an opposition to this Surreply which means more filings.  MMA Payout will keep you posted.

Zuffa requests court to review Hunt ruling in antitrust case

August 29, 2018

Zuffa has filed a Motion for Leave to File Supplemental Authority regarding its Motion to Seal related materials in its Summary Judgment motion of Plaintiffs’ lawsuit in their antitrust case.

The supplemental authority is the recent ruling in the Mark Hunt case on Zuffa’s “Renewed” Motion to Seal Documents in that case.  The court previously denied the Motion to Seal but changed course in granting the “Renewed” Motion.  It should be noted that Hunt’s attorneys did not oppose the “Renewed” motion for some reason.

This Motion hopes to include this ruling in deciding the pending motion before the court in the Antitrust matter. They persuasively argue that Plaintiffs had referred to the previous Hunt ruling where the Court denied the sealing of records.  As Zuffa points out in this motion, the original order was “without prejudice” whereas the renewed motion was “with prejudice.”  The difference with or without prejudice is that “without” prejudice means that the ruling could be amended on a party’s motion.  With prejudice is the final ruling of the Court.

Supplemental Authority After Hunt by JASONCRUZ206 on Scribd

Payout Perspective:

The Hunt ruling, although I disagree with the outcome, will likely be considered in the antitrust case as it relates to similar documents.  Thus, the motion will be granted, and the Court will consider it as persuasive authority when determining whether or not to unseal the redacted materials by Zuffa.

Court denies Plaintiff’s request for Conor McGregor financial info, deposition in thrown can lawsuit

August 23, 2018

The plaintiff in the Conor McGregor lawsuit claiming injury to a thrown can during the August 2016 pre-fight press conference at UFC 202 was dealt a huge blow in discovery as the Court denied motions to compel financial information from McGregor and his deposition.

William Pegg claims he was injured as a result of McGregor throwing a can during the press conference altercation.  A lawsuit was filed in Clark County Nevada but was moved to federal court in Las Vegas by McGregor’s attorneys. McGregor denies wrongdoing in the lawsuit.

Prior to removal to federal court, Plaintiff filed a Motion to Compel documents with the motion to be heard in state court on May 30, 2018.  But, McGregor’s attorneys filed for removal on April 26, 2018.

Plaintiff’s attorney attempted to compel documents to determine McGregor’s ability to pay a potential claim as well as his deposition.  This included his W-2s, tax returns and payouts from the UFC.  McGregor’s attorney asserted that the financial information was confidential and not discoverable.  He also offered McGregor to be deposed in Dublin, Ireland after his October 6th fight with Khabib Nurmogomedov in Las Vegas.  Plaintiff’s attorney requested they depose McGregor in Las Vegas as it is known that he will be training there prior to his October 6th showdown with Khabib.  However, Defendant did not offer this as an option.  Discovery closes on October 23rd, so if they are unable to depose McGregor prior to then, he will not be deposed.

Motion to Compel Deposition of Conor McGregor by JASONCRUZ206 on Scribd

Defendant’s Response to Motion to Compel by JASONCRUZ206 on Scribd

Defendant’s Response to Motion to Compel Depo by JASONCRUZ206 on Scribd

Plaintiff included an example of how McGregor profited from this incident by embedding a screenshot of a “MacEmoji app” being sold which depicts him throwing cans.

The Court Order denying McGregor’s deposition notes that the Plaintiff failed to file a “Points and Authorities” section in its Motion which is a requisite in Court proceedings.  Thus, as outlined by McGregor’s attorneys, the motion should be denied for this failure alone.  The Court notes that Plaintiff’s motion failed to include any citations to legal authority.  As a result, they have “consented to the denial of his motion…”  For similar reasons, Plaintiff’s request for documents was denied for the same grounds.

Order on Plaintiff’s Motion to Compel Depo of Conor McGregor by JASONCRUZ206 on Scribd

Order on Plaintiffs’ Motion to Compel by JASONCRUZ206 on Scribd

Payout Perspective:

Being a lawyer is hard.  And aside from knowing the law, you must know the procedure.  In this instance, the fatal defect for Plaintiff was an elementary knowledge of the rules.  In its response to Plaintiff’s Motion to Compel the Deposition of Conor McGregor, his attorneys go after Plaintiff’s attorneys including requesting that they be sanctioned (fined) for not knowing the rules.  They note that the form of a motion is “a basic premise to all first year law students…”  Yet, Plaintiff did not do it.  This almost certainly harms Plaintiff’s case and it’s clear that this is being characterized as a “nuisance” claim.  In looking at this incident, it may have been helpful if the plaintiff would have gone after the UFC and/or the MGM as insurance may have kicked in.  Instead, Plaintiff is facing an uphill legal battle.

Egg whites and a UFC contract: Cung Le depo transcript reveals his signing with Zuffa

August 22, 2018

Cung Le met with Dana White and Lorenzo Fertitta in person to discuss signing with the UFC over egg whites at the UFC’s offices according to the released depo transcript attached to Zuffa’s Motion for Summary Judgment.  His testimony reveals that he was “stuck” in his UFC contract a year and a half after he retired.

The deposition took place in April 2017 in Las Vegas at the offices of the UFC’s lawyers, Boies, Schiller & Flexner.  Le testified that he negotiated his entrance into the UFC himself and was not represented by an agent or manager.  He indicated that he flew to the Bay Area to Vegas on his own and made his way to the UFC offices.  In the depo, he testified that he had an interest in the UFC and White and Fertitta were big fans of his from Strikeforce and when he competed on ESPN.

Exhibit 18 – Cung Le Depo by JASONCRUZ206 on Scribd

White and Fertitta had their chef cook Le egg whites and he was presented with a UFC contract.  Le stated that he wanted to look it over before signing.

It appears that they were discussion of his Identity Rights in the contract.  Since Le was doing movies, he was concerned about a conflict with his Zuffa contract.

Le testifies that he retired but was precluded from doing work with any other organization for a year and a half because he still had two fights left on his contract.  He stated he couldn’t do commentating and was not able to negotiate with Bellator.

For a look at our summary of the deposition of Ike Epstein, click here.

Payout Perspective:

There is a portion redacted where Le goes into who he contacted prior to filing the lawsuit.  It also may explain why he decided to file the lawsuit and become the named plaintiff in it.  Prior to this lawsuit, he had never been involved in any other legal proceeding.  The testimony on Identity Rights is interesting considering Le’s movie career and celebrity outside of the UFC.  What may be helpful for his cause his his testimony that he was “stuck” for a year and a half from doing anything because he was still under UFC contract.  This includes being foreclosed from doing commentary with another organization due to his contract with the UFC.  Le may be a perfect plaintiff for this case since he had an established MMA career prior to the UFC, negotiated his own deal and has a career outside of MMA.

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